Henry Lee Willis Center funds cut

Four state agencies have cut off funding for the Henry Lee Willis Center, citing “serious concerns” about the nonprofit’s finances and other issues.

The four agencies — the Department of Public Health, the Department of Child and Family Services, the Department of Developmental Services and the Department of Housing and Community Development — cut off funding on Friday, according to Alec Loftus, spokesman for the state Executive Office of Health and Human Services.

“Based on serious concerns with financial management and client care issues, state agencies have moved to terminate all contracts with the Henry Lee Willis Center,” according to an emailed statement from the executive office. “We are working collaboratively with impacted agencies on a plan that will help clients quickly and safely transfer to appropriate providers to ensure that their care is uninterrupted.”

The Willis Center, which has its main offices on Forest Street, operates social services programs in Worcester and surrounding towns, including substance recovery services, child and adolescent services, neighborhood services, developmental services and homeless family services, according to the organization’s website. It also offered counseling and residential treatment to people with HIV and AIDS, according to documents filed with the Internal Revenue Service.

According to the organization’s Form 990 filed with the IRS, the Willis Center brought in $12.3 million in revenue but had $12.6 million in expenses in fiscal 2011. It listed a negative cash flow of $285,000.

The Willis Center had been financially troubled for some time, having had to close several programs and lay off dozens of employees five years ago.

In January, the nonprofit struggled to meet its payroll for its 185 full- and part-time employees.

In an interview in January with the Telegram & Gazette, Carlton A. Watson, the organization’s executive director, explained the situation:

“A number of our programs have been posting losses,” he said at the time. “We don’t have a cushion to draw on; we have no margin. When reimbursements are cut or the number of placements (in programs) decline, it hits like ‘whomp,’ and we’re stuck.”

He said in January that the center’s board of directors was meeting to discuss a “strategic partnership.” Mr. Watson did not immediately return a call for comment yesterday.